The Appeasement Trap

Employees these days often ask for the world. But should you give it to them?

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Employees these days want -- and often get -- the world. The question is, should you give it to them?

Eileen Orenberg has just about had it.

Orenberg (not her real name) owns a small publishing company near Boston. Here's what put her over the top: She recently hired a receptionist -- an attractive, well-dressed, articulate man in his mid-twenties. Right from the beginning he was aggressive, negotiating his starting salary up to $31,500 and his title from administrative assistant to assistant to the president. After a mere 90 days on the job, he asked Orenberg out to lunch for his first performance review. There, he demanded that she raise his salary to $36,000. "He said he wanted to buy a house and had to net $3,000 a month to do so," Orenberg says. "He had only been at the company three months, and he brought no experience. We were teaching him everything. Everything!"

Orenberg was outraged but politely said she'd give the matter some thought. "You've got a week," he replied. Then he stuck his boss with the bill. (She refused to give him the raise he demanded; yet she insists on remaining anonymous because in this tight labor market, she can't afford to fire him.)

Come on. Admit it. You're pissed off.

You'll be damned if you're going to let it show on your face, but your patience these days is wearing a bit thin. It's certainly not from a lack of work to do. In fact, there's more opportunity than ever for your company to rack up record sales. If only you could find the people. Recruiting the right staff is your key to riding the current economic wave all the way to your own commercial Valhalla. It all comes down to finding -- and keeping -- the best people.

Trouble is, they know it.

An unprecedented sense of entitlement has crept over the American workforce, and the change in mind-set has come as a shock for many employers. In a seller's market for skilled workers, employees are more demanding about what they want and less appreciative of what they get. The question in the long run is, Who can afford to keep handing out car keys to every employee, from the receptionist on up? Where do you draw the line?

To reduce turnover, North Highland CEO David Peterson actually started turning business away.

There's no easy answer, even for a CEO like David Peterson of North Highland Co. Peterson prides himself on having created an exceptionally employee-friendly information-technology consultancy. To reduce turnover among his travel-weary staff, Peterson has had to turn away business. Now he will take jobs only within a 50-mile radius of his Atlanta headquarters -- unless employees volunteer to staff a more distant site. Peterson says that that policy has helped keep his annual turnover at a manageable 10%.

But sometimes people leave no matter what you do. Recently, a 24-year-old employee of Peterson's took off for an opportunity at a dot-com start-up. On his way out, the employee said to Peterson, "I love this place, but they're throwing a lot of stock options at me, so I have to take this chance. And if it doesn't work out, I can always come back here, right?"

Such casual disregard for company loyalty has quite a few CEOs getting in touch with their angry side. Mark Zweig of Zweig White and Associates Inc., a recruiting company in Natick, Mass., hit his limit when a member of his staff recently left to work for the proverbial dot-com. "He sent everyone on staff this E-mail saying that he hated to go, but it was a great opportunity, with stock options, an IPO, and blah blah blah," recounts Zweig.

Zweig zipped off a rejoinder to the entire staff. "I said, 'No recruiter has ever left here and stayed at the place they went to for more than 12 months,' " he says. "Recruiting people are great at selling their company. But you know what? They lie." When Zweig heard that some of his staff thought his response was harsh, he lashed back. "I say screw them," he says. "I want people to know what the real world is like."

Sure, the real world is harsh, but today it's harshest for staff-starved employers, who offer no end of economic enticements to anyone -- inside or outside the company -- who'll help them net the head count they require, from multithousand-dollar bonuses to large-screen TVs to splashy new cars. To the recruits themselves, companies proffer huge signing bonuses, profit-sharing and retirement plans, relocation costs, college tuition -- heck, even the down payment on a house. In many industries, stock options have become a given and have entered the recruiting calculus as never before.

And the coddling doesn't stop once the star recruits come on board. In an effort to stay culturally competitive, companies cosset their staffs with a spiraling catalog of creature comforts: chefs to cook breakfast, lunch, and dinner; on-site fitness facilities; weekly massages; monthly house cleaning; meditation rooms; concierge services for laundry and shopping; and trips to Hawaii and other temperate locales. And make sure that you're surrounding your people with the latest technology, a fun and challenging work environment, a say in the strategic future of the company, and an impending initial public offering that'll pop pronto and make them rich.

Oh, and could you validate their parking, too?

More and more, in the eyes of many job seekers, those amenities have morphed from perquisites to prerequisites. A recent survey by Los Angeles-based Jobtrack Corp. found that 50% of today's college students expect to be millionaires by the time they turn 40. The employment mantra of the new millennium: Buy me now, keep me cozy, make me rich -- otherwise I bolt.

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